NNPC Sources Crude to Support Dangote Refinery Amid Rising Fuel Prices

The Federal Government, through NNPC, is sourcing crude oil from international traders to supply the Dangote Petroleum Refinery and sustain domestic fuel production. Despite this, high petrol prices persist, with pump prices exceeding N1,000 per litre due to limited domestic crude allocations, reliance on imported crude, and global oil market pressures. The refinery has expanded its distribution partners to maintain supply, but fuel costs are unlikely to drop immediately.

The Federal Government, through the Nigerian National Petroleum Company Limited (NNPC), has started securing crude oil supply for the Dangote Petroleum Refinery by sourcing from third-party international traders to sustain domestic refining operations. Officials, however, warned that this intervention may not immediately reduce petrol prices, as Nigerians are already facing high fuel costs. Retail pump prices have exceeded N1,000 per litre in some states and reached about N1,200 per litre at certain stations, marking the third increase in a week. The refinery temporarily suspended the loading of Premium Motor Spirit (PMS), raising concerns about further price hikes.
The Dangote refinery currently receives only five cargoes of crude from NNPC each month instead of the 13 required under the naira-for-crude policy, forcing reliance on imported crude at international market rates. Global factors, including the Iran-US crisis and rising Brent crude prices above $92 per barrel, have made it costly for refiners to rely solely on imported crude. Crude imports from the United States surged to 41.13 million barrels in 2025, up 161 percent from 2024, reflecting Nigeria’s growing dependence on foreign supply.
NNPC is leveraging its global trading network to source competitive crude for the refinery, while the Dangote refinery cautioned that this may not immediately lower fuel prices because global energy costs remain high. Analysts note that increased domestic refining output and full implementation of the naira-for-crude policy could help moderate prices, but import restrictions, operational costs in free trade zones, and limited crude allocations remain challenges. Nearly 90 percent of marketers seeking petrol import permits have been denied, giving the Dangote refinery significant market influence.
Despite these pressures, the Dangote refinery has helped prevent even higher fuel costs, absorbing some of the cost escalation to maintain supply. Domestic crude allocations remain insufficient, with local refiners receiving 67.66 million barrels from January to August 2025, far below the 123.48 million barrels requested. To improve supply, the refinery has approved over 30 petroleum marketers and distribution partners, expanding access and ensuring continued lifting of PMS across Nigeria.